Wpa Pool | Getty Images Entertainment | Getty Images LONDON — U.K. Prime Minister Boris Johnson’s leadership is hanging by a thread after two of his most high-profile ministers and several other top officials and cabinet aides resigned in the past 24 hours. British Chancellor of the Exchequer Rishi Sunak resigned on Tuesday night, saying the government must be run “properly, competently and seriously”. Health Secretary Sajid Javid also resigned in protest at Johnson’s leadership, which has been marred by controversy and scandal in recent months. As several senior Tories called for Johnson to step down, the government’s former Brexit negotiator David Frost also joined the fray, calling for the prime minister to step down without delay. In a newspaper column on Wednesday, Frost echoed other critics of Johnson by saying unequivocally that “it’s time for him to go”, adding that “if he continues, he risks taking the party and the government with him”. Despite calls for his resignation, the prime minister shows no signs of being ready to step down. Last night he reshuffled his cabinet to fill the vacancies created by the shock resignations. Several ministers defended Johnson, expressing their faith in him. Top figures remaining in the cabinet include Deputy Prime Minister Dominic Raab, Foreign Secretary Liz Truss and Home Secretary Priti Patel.
Chances for early elections
For now, the faith of top ministers reduces the immediate prospect of an early election in Britain. For that to happen, Johnson would have to resign or face another confidence vote. Having faced such a vote just last month, a new challenge would require a rule change to allow another vote within the next 12 months. “The party’s current rules state that Johnson cannot face another impeachment vote until next summer. But the main risk now is that either those rules change to force a new vote or Johnson is forced to step down voluntarily.” , said Alan Monks. economist at JPMorgan, said in a note Tuesday night. “Events could move very quickly, with a Conservative leadership contest potentially setting up a new Prime Minister in the next two months or so – before the party’s annual conference in early October.”
Market response
Sterling fell to a new March 2020 low on Tuesday as political uncertainty unfolded in the UK. How the markets react in the coming days will be closely watched. “There’s paralysis and there’s so much uncertainty about exactly how it’s going to play out,” Ben Emons, managing director of Global Macro Strategy at Medley Global Advisors, told CNBC on Wednesday. “The way the markets reacted, somewhat negatively as sterling and British gold yields fell, but then recovered and I think that shows that while there is uncertainty around the position of the Cabinet and Johnson, it’s not has collapsed, it still has support,” he said. “We’re not going to see an early election, they have to elect a new leader for that to happen, so I think the markets are relieved [the fact that] we will enter a period of some uncertainty, but that uncertainty reflects the status quo, nothing will change in the economy or with politics,” he told CNBC’s “Squawk Box Europe.”
Series of scandals
The latest political turmoil to hit the UK comes after a series of controversies, ranging from the “partygate” scandal with Johnson and several other government officials found to have broken pandemic quarantine rules, to allegations – the latest of which concern Chris Pincher, the deputy leader of the Conservative Party, responsible for maintaining party discipline. Pincher resigned and was suspended as a Conservative MP last week after allegations he drunkenly shouted at two men at a private members’ club. It has since emerged that Johnson appointed him to the role despite being aware of previous allegations of misconduct against him. Johnson apologized for appointing Pincher as deputy chief, but it was too late with high-profile resignations coming minutes later. Johnson has survived a series of challenges to his leadership in recent months, as well as calls for him to step down, particularly after a dismal confidence vote and defeat by the Conservative Party in two key by-elections in the past month, as his loyalty British public its leader wears thin. A YouGov snap poll on Tuesday found that 69% of Britons polled want Johnson to resign. The poll of 3,009 adults found that only 18% want to remain. Among Conservative voters polled, 54% said they want to see Johnson go, while 33% want him to stay in, showing that Johnson has become an unpopular figure for many voters who were initially attracted to his leadership in 2019, when he won a whopping 80 – a majority of seats in his election bid to ‘get Brexit done’. The leader of Britain’s opposition Labor Party, Keir Starmer, tweeted on Tuesday that “the Tory party is corrupt and changing one man will not fix it. Only a real change of government can give Britain the new start it needs he needs”. Nadhim Zahawi, Britain’s new finance minister, told Sky News on Wednesday that he backed the prime minister and said “the team in government today is the team that will deliver”, but Ed Davey, the leader of the opposition Liberal Democrats , told CNBC that “it’s clearly in the national interest for Boris Johnson to go” and that Johnson has proven deceitful in the past. “Having a British Prime Minister who is clearly not telling the truth and lying on an industrial scale is damaging to our democracy, it’s damaging to Britain’s reputation around the world and it’s damaging to our investment… We need a government that knows what does”. Johnson has been accused of lying on several occasions during his time in office, although he has always denied doing so, and has denied misleading parliament about the partygate scandal, which is under investigation.
